Answers Archive

Tax efficiency for selling vacant recreational real estate

Deduct the selling costs from the sales proceeds. One half of the capital gain will be included in your income in the year of sale. Furthermore, property taxes cannot be added to the cost basis of the property. Unfortunately, there is not much more that you can do to save tax.

Interest on loans for rental property

Yes, you can still deduct the interest even though it’s a new loan. This is because the loan proceeds are being used for an income-producing purpose.

Dtmax and goodwill gain

The gain from the sale of goodwill should be reported on Schedule 8 and Schedule 3 of the T2 corporate tax return.

A gift is given to small business

Record the amount received as other income on the financial statement and T2 return.

Notarized Gift letter

No, that will not be a problem from a Canadian tax perspective. Check with the bank if they will accept a notarized Gift Letter to transfer the funds.

schedule 100 balance sheet and asset recording

The gross cost and the accumulated depreciation of assets must be disclosed on Schedule 100.

Retiring and becoming Non resident of canada

When you become a non-resident of Canada, you are deemed to dispose of all of your assets (excluding cash, Canadian real estate, pensions, RRSPs and TFSAs). The deemed disposition rule applies to shares in the capital stock of a Canadian corporation. Furthermore, the deemed selling price of the shares is equal to the fair market … Continue reading

Receive CAD in lieu of INR

No, so long as it’s not a business transaction, I don’t see how this would be taxable.

Need to apply for reseller certificate in USA, do I need to open LLC and have EIN before applying for the reseller certificate

No, you do not need to open a US entity. You can do business with Amazon.com through a Canadian corporation. Make sure you apply for a US EIN for your Canadian corporation and provide this number to Amazon.com

Previously-purchased computer now used for work

You need to determine the fair market value of the computer on the date that you began using it for business purposes. You can then claim CCA on the FMV.

Monetary gifts to family members

Both family members and unrelated individuals can make a gift to you, and you will not pay tax in Canada on the gift received. The gift letter should be notarized in Dubai.

Gift from uncle/aunt/cousin

Yes, you can.

Transferring Primary Residence to Corporation

Prepare a gift letter and transfer title of the property for $0. A lawyer can assist with this. The deemed sales price for tax purposes is equal to the fair market value of the property on the date of the gift. A certified appraiser can determine the fair market value. Since the property is your … Continue reading

Meaning of Line 7 : Spouse or common-law partner amount in TD1 – 2020 Personal Tax Credits Return

Hi, Enter $13,229 on Line 7 – Spouse Amount.

company has received a reassessment for additional HST owing relating to prior tax years

Match the additional HST paid to the expenses that it relates to and increase those expenses accordingly. If you are unable to match, then record the HST paid and not recoverable as HST Expense.

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